The second prototype SEV-3 was completed as a two-seat fighter derivative, the SEV-2XP. It was powered by a 735 hp (548 kW) Wright R-1820 radial engine, had fixed landing gear in aerodynamic spats[4][5] and was armed with one .50 in (12.7 mm) and one .30 in (7.62 mm) forward-firing machine guns plus an additional .30 in (7.62 mm) gun for rear defence.

When the USAAC announced a competition for a new single-seat fighter in 1935, Seversky sent the SEV-2XP, confident it would win despite being a two-seater. However, the aircraft was damaged on 18 June 1935 during its transit to the fly-offs at Wright Field. To compete with the Curtiss Model 75, a single-seat aircraft with retractable undercarriage, Seversky rebuilt the aircraft into the single seat SEV-1XP, replacing the SEV-2XP's fixed landing gear with a retractable undercarriage where the mainwheels retracted backwards into the wing, and an 850 hp (634 kW) R-1820-G5 replacing the -F3 of the SEV-2XP. The SEV-1XP was delivered to Wright Field on 15 August for evaluation, which was generally successful, although the Cyclone failed to deliver its rated power and the SEV-1XP only reached 289 mph (465 km/h) rather that the 300 mph (483 km/h) predicted by Seversky.[6]

Protests from Curtiss led to the formal flyoff between the fighters to be delayed until April 1936. The delay was used by both Seversky and Curtiss to improve their aircraft, while allowing additional fighters from Vought (the Vought V-141) and Consolidated with a single seat version of the PB-2. The SEV-1XP was re-engined again, with a two-row Pratt & Whitney R-1830-9 "Twin Wasp" replacing the Cyclone and a modified vertical stabilizer fitted, becoming the SEV-7.[5][7]

The P&W also failed to deliver its rated power—it put out only 738 hp[citation needed]—and top speed was again well below 300 mph. While more expensive than the Curtiss and Vought designs, the Seversky was a clear winner of the Air Corps' competition, with an order for 77 P-35 fighters being placed on 16 June 1936. Modifications from SEV-1XP to production P-35 standard included partial instead of complete mainwheel fairings and seven degrees of dihedral to the outer wing panels.[8]

The first production P-35 was delivered to the USAAC in May 1937, preceded by a company owned pre-production aircraft and demonstrator, the AP-1.[8] Only 76 P-35s were built, delivery being completed in August 1938, with the 77th aircraft finished as the prototype XP-41.[9] When it wanted further fighters in 1937, the Air Corps, who were unhappy with both the slow delivery of the P-35, and sale of 2PA two-seat aircraft to the Japanese Navy, ordered 210 Curtiss P-36s.[10]

Seversky continued to develop the design with the hope of selling more aircraft both to the Air Corps and to civil and export customers. It modified the prototype SEV-1XP as a single seat racer, the S-1 entering it into the 1937 Bendix Trophy, where it finished in fourth place. The competition was won by the S-2 (registration number NR70Y), a similar aircraft built for Frank Fuller of the Fuller Paint Company.[11] S-2 also won the Bendix Trophy in 1939[12] and placed second in 1938.[13] The aircraft was used to portray the "Drake Bullet" in the 1938 film Test Pilot.

Another civil aircraft was the DS, (or Doolittle Special), a single seater for James Doolittle, employed at the time by the Shell Oil Company, while the AP-7 was another racer, powered by a 1,200 hp (895 kW) R-1830 engine and used by Jacqueline Cochran to win the 1938 Bendix Trophy race and to set a women's air speed record.[14][15] Seversky entered two aircraft based on the P-35 in a 1938 competition for a new fighter for the Air Corps. One was the XP-41 (which had the company designation AP-4D, which was a P-35 with a 1,200 hp (895 kW) R-1830-9 engine fitted with a two-stage supercharger and the AP-4, which had a turbo-supercharger mounted in the belly of a deeper fuselage. The Air Corps preferred the AP-4D, which was ordered into production as the P-43 Lancer.[9][16][17]

Aiming to increase sales, Alexander P. de Seversky personally took a demonstrator on a tour of Europe in early 1939. As a result of this demonstration, Sweden ordered 15 EP-106 fighters on 29 June 1939,[18] a development of the P-35 powered by a 1,050 hp (783 kW) R-1830-45, which improved performance by over 25 mph (40 km/h) and armed with two 7.9 mm (.311 in) machine guns in the cowl and two 13.2 mm (.52 in) machine guns in the wings.[19] A second order for 45 EP-106s was placed on 11 October 1939,[18] with a third order for 60 aircraft, placed on 6 January 1940, although by this time Seversky had been thrown out of the company bearing his name by the board of directors, with the company renaming itself Republic Aviation.[20] The Swedish Air Force designated them J 9.[21]

Nonetheless, despite its obsolescence as a fighter design, the P-35 design served as the inspiration for the promising Italian Reggiane Re.2000Falco fighter which bears a superficial similarity in layout.[22]

Seversky also built a two-seater, the 2PA. Evolved in parallel with the P-35, the 2PA was a two-seat fighter and fighter-bomber with a fundamentally similar airframe and offered with either a similar undercarriage to that of the single-seater as the 2PA-L (Land) or with an amphibious float undercarriage as the 2PA-A (Amphibian). Dubbed "Convoy Fighter" by the manufacturer, the 2PA was powered by a Wright R-1820-G2 or G3 Cyclone nine-cylinder radial engine, the former rated at 1,000 hp for take-off and the latter at 875 hp. Armament comprised two wing-mounted 7.62 mm or 12.7 mm Browning guns, one 7.62 mm Browning on a flexible mount in the rear cockpit, plus two forward-firing fuselage-mounted 7.62 mm or 12.7 mm Browning guns. Provision was made for a bomb load of up to 227 kg (500 lb) on internal wing racks. One 2PA-A and one 2PA-L were procured by the Soviet Union in March 1938, one with conventional landing gear and one with floats, along with the manufacturing license, but it appears that the Soviets never put it into production. In what proved to be an unpopular move for Seversky, 20 2PA-B3s were sold to the Japanese Navy, which briefly employed them in the Second Sino-Japanese War as Navy Type S Two-Seat Fighter or A8V-1 (Allied codename "Dick"). The Japanese were unimpressed with the aircraft and eventually relegated two of them to the Asahi Shimbun newspaper as "hacks." Sweden ordered 52 2PAs (Swedish designation B 6), able to carry 1,350 lb (612 kg) of bombs, but received only two prior to the U.S. embargo directed to combatants.[19] The remaining 50 were appropriated by the USAAC, re-armed with 0.30 in and 0.50 in machine guns, and used as advanced trainers named AT-12 Guardsman.

The first P-35s were delivered to the 1st Pursuit Group (27th, 71st and 94th PS) stationed at Selfridge Field in Michigan. The aircraft utilized a wet wing to save weight and ground personnel quickly learned about the persistent fuel leaks. The P-35's performance was poor even by contemporary standards and, although USAAC aviators appreciated the aircraft's ruggedness, it was already obsolete by the time deliveries were finished in 1938.[23]

On 18 June 1940, United States declared an embargo against exporting weapons to any nation other than the United Kingdom. Optimistically, Republic continued to manufacture EP-106s which, by the 24 October 1940 order, 60 were taken over by the USAAC as the P-35A. The aircraft were re-armed to American standards with a pair of 0.50 in machine guns that fired through the propeller, but retained the Swedish specification of a 0.30 in machine gun mounted in each wing. Flight instruments were metric, and both their labeling and flight manuals written in Swedish. Of these, three aircraft were kept in United States as instructional airframes for mechanics. Six P-35As were delivered to Ecuador to form the first combat unit, the Escuadrilla de Caza.[24] The remainder were sent to the Far East Air Force in the Philippines beginning in February 1941. Eventually all pilots of the three pursuit squadrons on Luzon transitioned to the P-35A from the P-26. About 10 of these were lost in accidents. The P-35s were used primarily as gunnery trainers by all three squadrons because of a critical shortage of .50-caliber ammunition in the Far East Air Force, placing a strain on the engines of all the aircraft since no replacement engines were available. In October 1941, the P-35s were earmarked for transfer to the Philippine Army Air Corps after sufficient Curtiss P-40 Warhawks were received by the FEAF.

In November 1941, after the 3rd and 17th PS received new P-40E aircraft, most of their P-35As were passed to two newly arrived squadrons attached to the group, the 21st and 34th PS, with the latter receiving most. The 21st PS received its P-40Es on the eve of war and transferred its few P-35s to the 34th Pursuit Squadron, which then had nearly a full squadron.[25] It then fought with them in the futile defense of the islands in December 1941, initially at Del Carmen Field. They were hopelessly outclassed by the Japanese fighters. Lack of armor and self-sealing fuel tanks made the aircraft extremely vulnerable (12 P-35As were destroyed and six damaged by a Japanese strafing attack on Del Carmen Airfield on 10 December[26]) and by 12 December 1941, only eight P-35As were still in flying condition.[23] However, also on 10 December 1941, a P-35A of the 34th Pursuit Squadron piloted by 1st Lt. Samuel H. Marrett is credited with the sinking of W-10 during the Japanese invasion of Vigan in northern Luzon. Marrett made multiple strafing runs against W-10, until the ship blew up. The explosion was so powerful it tore the wing off of Marrett's P-35, causing him to crash in to the sea.[27]

In January 1942, five surviving P-35As attempted to fly to Bataan from Lubao Airfield, but two were shot down as they attempted to land, and a third was destroyed in place when no volunteer could be found to fly it. The two remaining P-35s transported several unit personnel to Mindanao in their baggage compartments. On 4 April, they returned briefly to Bataan to evacuate other personnel, and one was lost crash-landing on Cebu on 10 April. The sole surviving P-35 was turned over to Capt. Ramon Zosa of the PAAC on 30 April, and flew its last sortie out of Del Monte Airfield, accompanying a P-40 on a strafing attack of Japanese landings at Macajalar Bay on 3 May 1942.

The Swedish Air Force received 60 J 9s in the spring-summer 1940. The aircraft were operated alongside other units assigned to the F 8 Air Force base protecting Stockholm, replacing the obsolete Gloster Gladiators.[28] Swedish J 9s served with Flygvapnet as a fighter until 1946. Later, 10 aircraft were equipped with cameras but retained their J 9 fighter designation and, in addition, a number of others were used for liaison and general flight training. The last seven J 9 aircraft remained in service until September 1952.[29]